The interest rate should fall with global warming. Remedial policy should allow for this endogeneity. In the simplest infinite-horizon model yielding a steady-state, one can derive the trend that an ad valorem fossil fuel tax should take to internalize the externality from emissions. It is negative. If implemented, it would reduce fossil fuel depletion and raise the rates of interest and growth to the values they would have had without global warming. The case for a falling fossil fuel tax is reinforced by the possibilities of future emission abatement and learning about the damage that emissions cause. Copyright 1994 by Royal Economic Society.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 46 (1994) Issue (Month): 0 (Supplement Oct.) Pages: 869-77 Download reference. The following formats are available: HTML
(with abstract),
plain text
(with abstract),
BibTeX,
RIS (EndNote, RefMan, ProCite),
ReDIF
Handle: RePEc:oup:oxecpp:v:46:y:1994:i:0:p:869-77
Contact details of provider: Postal: Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK Fax: 01865 267 985 Email: Web page: http://oep.oupjournals.org/
For technical questions regarding this item, or to correct its listing, contact: (Christopher F. Baum).
Related research
Keywords:
Cited by: (explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)